Law:

Section:

Section 158BD of the Income-tax Act, 1961 - Block assessment in search cases - Undisclosed income of any other person - Assessment year 1997-98 - Where no satisfaction had been recorded by Assessing Officer of person searched that amount seized during course of search proceedings was an undisclosed income of assessee, notice issued to assessee under section 158BD could not be sustained [In favour of assessee] The petitioner/assessee received a notice under section 158BD requiring him to prepare a true and correct return of total income including the undisclosed income in respect of which the petitioner was assessable for the block period starting from 1-4-1988 to 31-3-1998 and 1-4-1998 to 22-9-1998, that was till the date of search. The petitioner submitted that the basic requirement of section 158BD that the Assessing Officer of the searched party is required to be satisfied that undisclosed income belongs to any person other than the person with respect to whom search was made under section 132 or whose books of account or other documents or any assets were requisitioned under section 132A was not satisfied in the instant case, hence the notice under section 158BD was bad in law. Held that evidently no satisfaction as required under section 158BD had been recorded by the Assessing Officer of the person with respect to whom the search was made, prior to handing over the documents referred to in the aforesaid communication. In the circumstances, the basic condition precedent for invoking section 158BD qua the assessee had not been satisfied. In the aforesaid premise, in the absence of the basic requirement for invoking section 158BD being satisfied, respondent No. 2 lacked the jurisdiction to issue such notice and, as such, the impugned notice under section 158BD could not be sustained. Manish J. Shah for the Petitioner. Mrs. Mauna M. Bhatt for the Respondent. JUDGMENT Ms. Harsha Devani, J. - By this petition under Art. 226 of the Constitution of India, the petitioner has challenged notice dt. 1st March, 2001 issued by the respondent No. 2 under s. 158BD of the IT Act, 1961 (the Act). 2. The facts of the case as appearing in the petition are that the…

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